The court affirmed that shareholder objections must be raised during meetings, and resolutions passed in compliance with the Companies Act are valid despite subsequent challenges by absent shareholders.

Introduction

[1] The Plaintiff in encl 49, the Amended OS, sought declarations that the Notice of the Special Meeting of Shareholders of the 1st Defendant dated 30 July 2021 and the Resolution of the Shareholders of the 1st Defendant approved on 16 August 2021 (the Resolution) are invalid, null and void.

[2] This action was based on the grounds of ultra vires of the Constitution of the 1st Defendant company and/or that it is sub judice and/or that it was an act of interference with the administration of justice or the execution of justice of the court proceedings that had not yet been decided and/or were invalid, null, and void, thus, required that all resolutions and/or decisions pursuant thereto be set aside.

Background Facts

[3] On 31 July 2021, the Plaintiff received an email from the Company Secretary of the 1st Defendant, enclosing a Notice of a Special Meeting of the shareholders scheduled for 16 August 2021, at 11.00 am. (Special Meeting). The meeting was to take place via video conference.

[4] Subsequently, through an email dated 5 August 2021, the Plaintiff gave a notice to the Company Secretary of the 1st Defendant to immediately withdraw the said Notice of the Special Meeting of Shareholders of the 1st Defendant together with Appendix A. The grounds for this demand were as follows:

a. The said Notice and Appendix A were deemed ultra vires or flawed due to their inconsistency with both the Company's Memorandum and Articles of Association and the provisions of the Companies Act 2016 ;

b. The failure to include the proxy form with the said Notice;

c. Despite the High court in Kuala Lumpur under Originating

Summons No: WA-24NCC-488-09/2018 affirming the acknowledgment of debts owed by the 1st Defendant and its Subsidiaries to the Plaintiff and other creditors, Appendix A omitted the said debt;

d. The credibility of Appendix A was undermined due to its non-certification by the Company's Auditor;

e. There exist contradictions between Appendix A and the Audited Reports of Kuala Ibai Development Sdn Bhd (1st Defendant) and its Subsidiaries;

f. The convened meeting appeared to be an effort to evade compliance with the Consent Order dated 14 July 2020, issued pursuant to the Kuala Lumpur High court Suit No: WA- 24NCC-65-02/2020;

g. The meeting's intent was perceived as an abuse of process, evidently designed to impede the outcomes of ongoing legal disputes involving shareholders and various corporate entities;

h. In the event that the mentioned Notice of the Special Meeting was not retracted or annulled within 48 hours from the moment of the email transmission, the Plaintiff indicated his intent to pursue appropriate remedies, including the pursuit of an injunction, without any further notice;

i. Meanwhile, the Plaintiff underscored the reservation of all its rights.

[5] However, the response received via email from the Company Secretary on 6 August 2021, did not yield the desired outcome.

[6] Subsequently, on 8 August 2021, the Plaintiff filed the Originating Summons herein. However, notwithstanding the Plaintiff's objection, the 2nd and 3rd Defendants proceeded with the Special Meeting on 16 August 2021 and approved the Resol